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This blog is a collection of my personal thoughts, comments and ideas about all things digital.
I don't have a particular focus but write little bit about everything, such as reviews of marketing campaigns and methods I see being used, digital strategies, technologies and other cool stuf I come across with.

Friday, 20 May 2011

Analysis of Argos' multichannel purchase experience

Argos Website
This analysis reflects my first-hand experience with Argos and how they've executed their multichannel experience. The products I chose to buy were two ink cartridges for my printer. Despite the clear layout and structure of the Argos website, I could not find suitable cartridges for my printer based on the available product descriptions. After searching for the printer I own, the site provided a cross-selling option with the suitable cartridges for the printer. These cartridges were the same ones I had previously browsed but the product description was still missing the model of my printer (Canon MP250). After a search in Google confirmed that the cartridges were suitable for my printer, I was able to proceed with the purchase. The product descriptions might be adequate for casual shoppers but could use some improvement still. Buying “blindly” over the web without physically seeing the product is of course always risky, but when purchasing for example furniture or something else that needs to suit the customer’s style and apartment, the Argos site could provide more product information and pictures from different angles. At the moment they loose by a mile when compared to competitors like Best Buy or Comet.

The “Buy or Reserve” call-to-action button stands out against the white background and is logically placed in the left side of the page. Above this is a box that allows customers to check the availability of the product in their neighborhood with buttons enabling again reservations but also the home delivery option with an estimated delivery time. To me this seems quite clear-cut at this point, I have the option to have the cartridges delivered to me, and I can buy them and collect at the store. However, when I get to “My trolley” I discover that the online payment option is only for those who decide to have their purchases delivered. The ones choosing the store pick up option can only reserve the product online but actual payment has to be made at the store. Now, this isn’t a huge problem but it’s still misleading to me.

The home delivery and store pick up options are clearly separated from each other with different call-to-action buttons but I still don’t see why I have to subject myself to unnecessary tasks when making a purchase. Paying at the store is few minutes of my life I could spend waiting for the green light at the crosswalk or for my BigMac, and if I’m already at the online store then it would make sense to get the money then and there. Forcing customers to come down to the store for their products is bound to lower the conversion rate, as people miss their collection period or get buyer’s remorse.

The online reservation is made based on my postcode to the nearest Argos store. The reservation details required are limited to only an email address and a mobile phone number, which is optional. I can even choose to have only a plain text email sent to me instead of a fancier HTML one. After placing the reservation I immediately receive an email with my order details, reservation number and how long my reservation is valid, and finally detailed store information with opening hours and a map of the area around the store. At least the reservation is made simple, quick and the confirmation email provides me with all the information I would think to require in order make the pick up.

Store pick up
When entering the store I see piles of the somewhat famous Argos catalogues that have every product the company is carrying at the moment listed in them. Quick research online (Yahoo! UK and various discussion forums) showed that people are still actually excitedly waiting for the release of every new catalogue, but as a medium for selling, it is inevitably going to die out. People holding on to the nostalgic paper catalogue will eventually switch to browsing products online and Argos will have to find a new way of differentiating their huge stock of products from competitors. One way of doing this is to take the catalogue and launch it in the similar layout for tablet computers. This would be more cost-effective for the company while providing people with a somewhat traditional layout of a catalogue with interactive and updatable components.

The catalogues in the stores could be removed as well, at least the ones meant for in-store browsing and replaced with monitors that enable quicker browsing and that would enable users to limit the search options to the stock available in the store.

The collection process makes me feel like I’m in some kind of a spy film. Typing of secret reservation numbers, collection of packages from shady looking teenagers and quickly existing the crowded store takes me about 15 minutes. Not exactly quick service, especially when there were only a handful of people in front of me waiting for the collection. I understand that Argos can save money with their unusual store layout solution, but it doesn’t really give me any benefit besides the slightly cheaper price. The service is as good as you would expect from a teenager working in this kind of a job, selling the kind of products Argos does. As consumers become more and more educated on how to browse the web for the cheapest offers, Argos will have to take a serious look at its business model. The only way the can survive with their current model of selling low quality products is if they sell them the cheapest. If they cant’ compete on price they need to change or they’re going to be run out of business sooner or later. At the moment they can get by because of the massive volumes of products they move but this won’t keep them in the clear forever. Specialization in terms of products, services offered with them or differentiation in terms of product delivery could be different ways to go about it.

Benefits to Argos
Purchasing products online and having them collected from the store has clear advantages for Argos. It takes the efficiency and cost-saving aspect further than doing the whole process offline, which still enables Argos to save on costs that competitors have to bear. The showroom can have a very limited number of items on display and customers are pretty much left on their own to browse through the catalogues after which they can purchase the products they want and have them collected from the mysterious backroom. Cutting cost on the design and look of the store (and service) and putting emphasis on the stock room in terms of size and volume it holds makes sense to me. They make the customer do all the work (browsing for products, reserving them and paying with the ATM looking machine) and all Argos has to do, is have one teenager pick up the product and have another one hand it to me. Cost cutting can be seen at each step of the process and its very evident at the store. The design is just nice enough for average consumers but nothing to write home about.

What I don’t get is why Argos won’t let me pay online before a pick up. I know the company did the purchase and collection thing offline before they enabled it online, but I can’t but help to see mostly negative aspects with this. It’s old-fashioned, ineffective and must result in lower conversion as well. Some forum discussions mention cases where Argos has had products on sale on the day of the reservation but when customers have gone to the store for the collection the sale has ended and the price has gone up. In some cases there has been a sale but nearby Argos stores have had no stock left according to the online store. The day after the sale has ended the stocks of these stores have magically gone up. In one case this happened right after (08.00 am) a bank holiday when simultaneous re-stock of items to these stores would have been unlikely. This seems a bit fishy to me and seems more like a way to get people excited about a product with no intention of selling out the entire stock (http://bit.ly/mBly9L).

It’ll be interesting to see how Argos will be able to change its business model in the upcoming years. The rebranding of the stores and the website in 2010 left much for desiring and can partly explain the decrease in revenue. Interestingly multichannel sales counted for nearly 50% during that year and are expected to grow again this year (http://bit.ly/goiyOz). So it looks like the “click and collect” service is working for Argos. The question is for how long?

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About Me

An internationally experienced, multilingual, digital native with a dash of viking fury.

I'm passionate about digital marketing and currently work at Coalition Rewards in Helsinki, Finland as a Marketing Manager. When I'm not kicking ass in the digital marketing field I enjoy working out, playing sports and traveling around the globe.

I've had great experiences working for agencies as well for large and small in-house B2B and B2C marketing teams. I have several years of experience in large multinationals: Google, 3M and Nike and a solid understanding of the business challenges of large, mid-market and small businesses.